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U.S. auto sales in April expected to drop despite big discounts

DETROIT — U.S. auto sales in April likely fell nearly 8 percent from the same month in 2017 despite big discounts for consumers, industry consultants J.D. Power and LMC Automotive said on Thursday. For much of the past two years, the discounts offered by automakers have remained at levels that industry analysts say are unsustainable and unhealthy in the long term. April U.S. new vehicle sales will likely be about 1.31 million units, down from 1.42 million units a year earlier, the consultancies said. The forecast was based on the first 17 selling days of April. Automakers, including Ford and Fiat Chrysler Automobiles, will release April U.S. sales results on May 1. Earlier this month, No. 1 U.S. automaker General Motors said it will stop reporting monthly U.S. sales because the 30-day snapshot does not accurately reflect the market. GM will instead issue quarterly sales reports. U.S. new vehicle sales fell 2 percent in 2017 to 17.23 million units after hitting a record high in 2016. Sales are expected to drop further in 2018 as interest rates rise and more late-model used cars return to dealer lots to compete with new ones. LMC expects full-year 2018 U.S. new vehicle sales to come in at around 17 million units. "Uncertainty and unfavorable factors appear to be mounting for autos, including a volatile stock market, rising interest rates, rising oil prices and potential trade roadblocks," Jeff Schuster, LMC's head of global vehicle forecasts, said in a statement. The seasonally adjusted annualized rate of sales for April will be 16.6 million vehicles, down more than 2 percent from 17 million units in April 2017, the consultancies said. Retail sales to consumers, excluding lower-margin fleet sales to rental agencies, businesses and government, were set to decline about 9 percent in April. The level of consumer discounts, which can erode profit margins and undercut resale values, "remains the larger concern," the consultancies said. The average discount was $3,698, up $187 from April 2017. Discounts on trucks and SUVs were up $426, but down $226 on passenger cars. Reporting by Nick CareyRelated Video: Image Credit: Reuters Earnings/Financials Chrysler Ford GM JD Power

Chevy, GMC and Ram dealers are worried they'll run out of new pickups

One of the unexpected side effects of the ongoing coronavirus pandemic is a shortage of pickups at Chevrolet, GMC and Ram dealers. Supplies are running out, and the factories that build these trucks remain closed. Stores across the nation began increasing incentives in March, when the first stay-at-home orders were issued, in a bid to continue luring buyers into showrooms. They also launched online sales channels, or expanded their existing digital business. Sales nonetheless plummeted in April 2020, but in-demand vehicles, like the Ram 1500 and the Chevrolet Silverado, are still selling relatively well thanks in part to the aforementioned incentives. Pickups outsold sedans for the first time in April 2020, according to The Detroit News, by 17,000 units. The problem is that General Motors, Fiat Chrysler Automobiles (FCA), and Ford temporarily closed their factories in March. "The pipeline is very dry," said Mike Maroone, the CEO of a large dealership group named Maroone USA, in an interview with Automotive News. He told the publication his Chevrolet stores are sitting on a 30-day supply of the Silverado, which is one of America's best-selling vehicles. "That is a problem for us," he concluded. Coronavirus-related lockdowns and factory closures compound problems already faced by dealerships who represent General Motors-owned brands. They entered 2020 with a thinner inventory than a year earlier due to the 40-day United Auto Workers (UAW) strike that paralyzed the company late in 2019, and the 0%, 84-month offers announced in March have sapped supply. Ram wasn't affected by a strike, but it has relied heavily on generous incentives to move trucks off lots. Ford, on the other hand, limited incentives to 2019 models. Inventory levels differ greatly from region to region. The national average for the Silverado stood at an 82-day supply in March 2020, down from 120 in March 2019. Ram stores had a 114-day supply of the 1500 (compared to 134 a year earlier), while Ford bucked that trend with a 111-day supply versus 84 in 2019. Don't panic if you're in the market for a truck; we're not facing a complete drought. Automotive News added that America's light-duty pickup inventory could fall to 400,000 units by the end of May, and drop further to 260,000 units in June. For context, there were about 700,000 light-duty trucks in stock in May and June of 2019. That's unquestionably a sharp drop, but there will still be over a quarter of a million trucks to choose from.

2017 Ford F-150 Raptor desert testing heats up

In case there was any doubt, Ford is taking the development of the second-generation SVT Raptor very, very seriously. The Blue Oval recently completed over 1,000 miles of testing in the boiling heat of the American southwest. Apparently, that mileage was accrued over a 66-mile route designed to mimic the torturous terrain encountered by racers in the Baja 1,000 off-road race. The prototypes, which were built from a mix of existing and next-gen Raptor components, were tested with "fast sandy washes, deep-rutted silt beds, steep climbs in deep sand, and slow meticulous crawls through tight trenches." Ford claims the new truck managed to run the circuit 25-percent faster than the current F-150 SVT Raptor, averaging 50 miles per hour while going as fast as 100 mph in stretches. That said, Dearborn didn't release any dedicated times, so it's unclear just how quickly the 66-mile stage was completed. We do know that durability was a big part of the testing. Ford claims each lap was completed by what sounds like a pretty significant jump, with the trucks ascending a steep ramp onto a two-foot plateau and then completing a step-down to level ground. We have to take Ford at its word here, though. "Steep" can mean any number of things, and we've no idea just how fast the trucks were hitting the ramp or how much air they got. Hopefully, the jumps were aggressive enough to prevent future frame issues. Still, Ford boasting about how rough the Raptor's testing is can be taken as a positive sign for fans of the next-generation of SVT's rugged pickup. NEW F-150 RAPTOR WRAPS UP INITIAL DESERT DURABILITY TESTING DEARBORN, Mich., July 7, 2015 – The 2017 F-150 Raptor – Ford's toughest, smartest, most capable off-road truck ever – recently completed more than 1,000 miles of testing in the southwestern United States. Over 1,028 miles of desert trail designed to parallel the Baja race course in Mexico, the 66-mile route featured a wide range of surfaces including fast sandy washes, deep-rutted silt beds, steep climbs in deep sand, and slow meticulous crawls through tight trenches. The truck topped speeds of 100 mph in places, slowing to 10 mph in others, for an average speed of approximately 50 mph. The 2017 Raptor is 25 percent faster than the current truck based on lap times. At the end of each lap, the new Raptor completed a tabletop jump consisting of a steep ramp up to a two-foot plateau, then a step-off back to level ground.